On Friday 8 December, S&P Dow Jones Indices announced the results of its annual Dow Jones Sustainability Indices (DJSI) review. Carrefour, Nexi, JDE Peet’s and Worldline are among the new members in 2023’s Indices, while Amgen, Novartis and AstraZeneca are the three largest companies which lost their spot in the World Index. This article summarizes the DJSI results and pinpoints the corresponding takeaways from Finch & Beak’s new State of ESG 2024 Report.
In 2023, S&P Global expanded its staggered approach to release the results of its Corporate Sustainability Assessment (CSA) to companies on a monthly basis, while the resulting Dow Jones Sustainability Index notations have only been published now. Companies that are eligible to be included in the Indices (which is determined based on their market capitalization) therefore already received their ESG Scores in the late summer and autumn, but they had to remain patient to learn about their inclusion in the Indices.
Key takeaways from the results
Based on this year’s CSA cycle and S&P Global’s communication, the following takeaways became evident:
- Challenging methodology updates
Major methodology changes were applied by S&P Global this year. Read more here about how this has affected companies in the 2023 assessment. For the 2024 CSA, proposals for feedback on upcoming methodology changes will be launched in December, and changes in public disclosure requirements will become available in January 2024.
- Important changes to the scoring model
In 2023, S&P Global introduced a differentiation between the CSA score and ESG score. Additionally, it is aiming to bring down the scoring ceiling, primarily through a push for increased transparency, higher standards for integration of policies and practice into strategy, and increased demands for tracking data on relevant issues that have important implications on scores of previously high scoring criteria.
- Exclusion screening for Sustainability Yearbook
For inclusion in S&P Global’s Sustainability Yearbook, as of this year companies are subject to an exclusion screening and a controversy screening. This means that for example companies with significant involvements and/or ownership concerning the production and the distribution of tobacco, creation and commercialization of weapons, or coal extraction are eliminated from the Yearbook. As leaders of their respective industries, they can still be part of the DJSI.
What’s next? State of ESG 2024
The DJSI results for 2023 again call for companies to strengthen their sustainability strategy to have a forward-looking approach and avoid the reporting trap. Finch & Beak’s State of ESG 2024 Report is now available and provides guidance to companies looking to create value beyond reporting.
Finch & Beak helps you to accelerate results from ESG benchmarking
With over 15 years of experience in Dow Jones Sustainability Index support, Finch & Beak is Europe’s leading expert in improving our clients’ sustainability programs and ESG benchmark performance. The Finch & Beak vision is to accelerate sustainability. Our ESG and sustainability strategy work is characterized by a continuous improvement method that leverages existing assets in the short term while identifying opportunities for strategic development in the future.
If your organization is looking to accelerate its ESG performance, please download our service description or contact Johana Schlotter at email@example.com or +31 6 28 02 18 80 to discuss how Finch & Beak could support you.
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